The amount of energy used in the economy per real dollar of GDP, "Energy Intensity", has been steadily dropping and is now about half what it was in 1950. So a barrel's worth of oil in 1950 now stretches to two barrels worth of work.

This is before the coming hybrid capital turnover in the transportation sector to double the efficiency there. So I guess prices will have to nearly double again to curb energy use like the 1970s oil shocks.

Posted by Sam Dinkin at November 18, 2005 10:36 AM

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Energy IntensityExcerpt: We are getting more and more out of every barrel of oil. Thats good news for America and bad news for oil companies and environmental groups. The former because they sell less oil, the latter because their “cause” is weakened.
...Weblog: The Exercise of Vital PowersTracked: November 19, 2005 12:38 AM

Comments

GOOD. And there's more. This is only part of the picture that the public is not being shown. You don't buy gasoline as an investment or to sit and watch it -- you buy it to MOVE yourself, so you are in effect buying 'transfer distance'. Since fuel efficiency in automobiles has about doubled in the past 35 years (quantitative verification requested), even at the same purchase price for a gallon of gasoline (inflation adjusted of course -- amazing how MANY newsmen can't grasp that concept when they bemoan 'record gas prices'), you're getting TWICE the utilitarian value. And the dollars you pay with don't appear out of thin air -- they are created by what REALLY costs a person, TIME and EFFORT. Inflation adjusted net personal income is also up measurably over the past third century, so again, for an equal amount of TIME/EFFORT a person is getting substantially more UTILITY even if the cash value looks equivalent -- and even here, the recent price adjustments are driving that ratio way down. This is a triple-whammy advantage of today's gasoline prices over the ones in the late 1970s. But for the math-challenged (reality-challenged) MSM, this doesn't convey the desired alarmist message so... we have to bypass them on this theme as well.

Plus, you have to travel less than you used to. I can do much more of my work from home than would have been possible in the 70s. Maybe it's a quadruple whammy.

Posted by Mitchell Burnside Clapp at November 18, 2005 10:50 AM

You are on to something Mike. Because of the hurricane displacement, and the gas price jump hundreds of companies are rethinking their telecommuting policies. Because of broadband connections and cheap laptops being at work is beginning to mean being logged on. The savings could be enormous. Twenty percent cut in commuting costs if you work at home one day a week. Watch out all you Bloggers we’ll all soon be joining you in our P.J.’s

Watch your multiple counting folks. Energy intensity captures fuel efficiency, telecommuting and everything else mentioned except for labor productivity (more dollars of GDP produced per person). The upshot is that while our economy will adjust--more nimbly and quickly than in the 1970s--it will adjust less so than in the 1970s. It's more that there won't be a big slump in economic performance (he says from his home office).

I wish they mentioned if these GDP dollars are inflation adjusted, because if they aren't, the result is reverse of what they claim.

Posted by Pete Zaitcev at November 18, 2005 03:26 PM

Joys of being exessively stupid... It's mentioned in "Highlights" section.

Posted by Pete Zaitcev at November 18, 2005 03:29 PM

There is a dark side to telecommunications. I was separated from my wife for a while and thought telecommuting from California to Washington would be a solution. I got my boss to agree to let me work that way, but the reality was if I wasn't warming a seat in the office my work didn't count for much.

Even though I could document doing 2.5 to 3 times the quality and quantity work of any other programmer, after a year they replaced me.

Many small companies are run by control freaks that don't make rational decisions based on work performance and results but by how well you politic. Otherwise, we'd have a much greater percentage of telecommuting workers already.

Posted by ken anthony at November 18, 2005 05:28 PM

I think there's a decent hope that fuel efficiency (for transportation) still has a fair amount of head room to grow. Consider hybrids for example, they're a perfect transition to electric vehicles for several reasons. It takes minimal equipment to charge the batteries off grid power at home (or at the office, or at the parking garage, should the facilities become available at those places), it's a logical functionality extension to the vehicle type for the future. Hybrid improvement fosters development of better batteries, better motors, more efficient energy sources, etc. Which in turns makes all-electric (or, say, fuel cell hybrid) vehicles all the more feasible. The combination of these two factors may serve as a way to ease into electric vehicle production and usage via hybrids. Also, hybrids pay off most where they are needed most, in heavier, lower mileage vehicles (which, naturally, take up a larger share of fuel usage).

Additionally, micro/nano/molecular advancements will eventually give us engines as efficient as biological machinery (or perhaps more so), which will be a tremendous improvement over today's engines. Even better, such achievements will make it all the more efficient to perform the reverse process (use energy to snag CO2 out of the atmosphere, combine it with water, and produce hydrocarbons) in an economically feasible fashion.

"Nature and physics don't care about "gdp" per used energy.
It's really simple: energy use per person has mostly gone up during recent history, as has the amount of people."

And most of that energy useage increase is electricity, something we have plenty of feedstock to make be it coal or nuclear.

Posted by Mike Puckett at November 19, 2005 10:32 AM

Great post - I'm aware of the major impact of compounding energy efficiency. But did not know about this Intensity Indicators site.

I've been assembling a post series on energy policy that might be useful, at least for resources. Of particular interest to me is whether the lauded Hydrogen Economy policy is valid - according to this study it is not.

Also, Armory Lovin's Winning the Oil Endgame is very interesting - good for cheering up anyhow. Lovins has another broader article in the September Scientific American that covers the whole economy - also optimistic. Is he correct?

Yes, to the extent we don't like carbon we should tax it. But we will have to tax it heavily to get usage to heavily decline. See http://www.thespacereview.com/article/231/1. It may be bad to pollute, but is it bad to be rich? "Ye canna change the laws of physics" -Star Trekkin.

Also, our ability to produce refined silicon wafers for electronic components that even make products of 10 years ago look brutish. Battery technology has progressed very little but cell phones that have 8 hours of talk time and laptops that have still managed to stay alive for several hours despite the fact that they have processors that pull as much power as a 130w light bulb is a direct result of more efficient silicon technology.

One really nifty technology I've been reading about recently is the Direct Carbon Fuel Cell. These are high temperature fuel cells that consume solid carbon instead of hydrogen gas. They use no precious metals or exotic electrocatalysts, and have molten electrolytes consisting of inexpensive molten carbonates, hydroxides, or fluorides. Because the overall reaction C + O2 --> CO2 does not reduce the number of gas molecules (and hence need to increase entropy elsewhere to compensate), the thermodynamic limit on the efficiency is close to 100%, and the best achieved laboratory efficiency is in the mid 80s%. DCFCs also avoid the entropy production that occurs during carbon gasification.

So far, prototype DCFCs have achieved power densities of 1 kW/m^2, which is acceptable for powerplants. It looks like the cells will be able to use cleaned coal as fuel, and this cleaning will not be too expensive. The projected capital cost of a DCFC plant will be less than that of a conventional steam powerplant of the same capacity, and the CO2 production will be only 1/2 as large. Even better, the CO2 comes out essentially pure, not mixed with nitrogen, so it can be much more easily sequestered. The cell operates at a sufficiently low temperature that NOx production is negligible, and any sulfur remaining in the fuel is captured in the molten electrolyte as sulfate ions.

Interestingly, one of the processes for producing cleaned coal is treatment with fluorine acids. This reminded me of technologies that have been proposed for extracting minerals from lunar regolith. Processing billions of tons of coal this way would produce large amounts of trace volatiles fluorides of various useful heavy metals.

Nature and physics don't care about "gdp" per used energy. It's really simple: energy use per person has mostly gone up during recent history, as has the amount of people.

But we should. GDP is a fair measure of how much gets produced by society. Producing more GDP with the same energy is a good thing. Among other things, this economic boost gives us a better ability to adapt to changing circumstances. Also, increased energy use isn't in itself a bad thing.

Second, I ran some PPP GDP per CO2 numbers. The more developed parts of Europe are substantially more efficient than the US or the developing countries India and China. I can't locate my figures, but the US dependency on fossil fuels is very evident in this comparison.